Through the looking glass: For the vast majority of PC owners, discs have become an archaic way of storing games. Thanks to the advent of Steam and high-speed internet connections, many computers don’t even come with optical drives anymore. It’s a different story for console gamers, of course, but could a day come when all platforms are digital-download only? Some analysts believe so, and claim it may arrive early as 2022.
Michael J. Olson and Yung Kim, analysts from US-based investment bank and asset management firm Piper Jaffray, made the prediction. “We believe it is a certainty that video games will be ~100% digital in the coming years, and while exact timing is hard to pinpoint, we think 2022 is a realistic expectation,” they wrote.
They note that virtually eliminating a title’s distribution costs would be great news for game publishers' bottom line, increasing gross and operating margins by more than 10 percent.
A 100 percent transition to digital doesn’t mean every game will be downloaded; it also covers those titles that are streamed, something the report says “could be a commercial reality within 2-3 years.”
While the report is based on current trends, it’s very hard to imagine the complete elimination of all physical games within the next four years. The recent US Games 360 Report showed that 66 percent of console gamers still prefer to purchase the physical version of a game, often due to the slower internet speeds in many areas of the country—whether that improves substantially by 2022 remains to be seen. There’s also the popular second-hand games market to consider.
There will come a time when games across all platforms become 100 percent digital, but with the next generation of consoles almost certain to feature disc drives, we’ve still got a while to wait.